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When's the best time to talk to the bank about a mortgage?

11:30 AEST Tue Mar 22 2011
When's the best time to talk to the bank about a mortgage?
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By Diana Clement, MSN Money expert

It's never too early to talk to your bank about getting a mortgage. Bank mortgage managers and other staff can give you support and advice throughout the process of buying your first home. They're a resource to be used when you're serious about buying property.

For example, your bank can give you advice about consolidating any existing debt you have, enabling you to pay it off faster and allowing you to start saving for a deposit.

Staff members can also advise you about how to set up and manage your accounts so you can save more. The advantage of having separate accounts for your saving, bills and spending money is that you're not tempted to dip into savings as easily.

In most circumstances you'll need a 20 percent deposit before you'll qualify for a mortgage. There are exceptions. If, for example, your parents are willing to go guarantor on some of the loan, you may be able to buy a home with a lower deposit. You don't know if you don't ask.

Your mortgage manager can also advise you how to overcome hurdles, such as a student loan, credit card debt or defaults on your credit record.

The process of getting a mortgage can be scary or confusing if you don't know how it works. One of the bank's mortgage managers can talk you through the process, which will make it a lot easier to understand come time to apply for the mortgage.

They can also help you by explaining the different type of mortgages and when it comes closer to the time to buy, can pre-approve your loan.